Journalism in the Public Interest

At Hearing, Lawmakers Ask Experts for Foreclosure Crisis Solutions


Iowa Attorney General Tom Miller testifies before the Senate Banking Committee on Nov. 16, 2010, in Washington, D.C. (Photo courtesy of the Senate Banking Committee)

At yesterday’s Senate Banking Committee hearing, three experts in the law—a state attorney general, a legal services attorney, and a law professor—agreed on this about the mortgage servicing industry: The problems aren’t just technical, and they aren’t just with robo-signing.

For the banks to characterize the situation in such simplified terms “shows a certain type of arrogance,” said Iowa Attorney General Tom Miller, the point man for a 50-state investigation into flawed foreclosure practices.

Diane Thompson, a legal services attorney with the National Consumer Law Center, told the panel that errors in foreclosures are “a widespread problem throughout the country.” She estimated that, in the cases she’s seen, about half of the defaults were caused by fees that banks themselves stacked on struggling homeowners. A smaller percentage, she estimated, were cases in which homeowners were not in default at all.

We’ve tracked the problems with banks’ servicing of mortgage loans, both in the foreclosure process and in the loan-modification process. Banks—confronted with employee depositions that show proper processing procedures were not followed—have said that they believe no wrongful foreclosures have occurred because regardless of the procedural errors, the underlying facts in the documents were accurate. Some have stated in calls with investors that they hope for a quick resolution to the controversy and are refiling the questionable documents.

But when Senate Banking Committee lawmakers asked the three experts about the best possible solutions to the problems, they suggested some that went much further:

1) Fund quality foreclosure-mediation programs and legal services for homeowners facing foreclosure. The Dodd-Frank financial reform bill authorized $35 million for programs providing legal assistance to homeowners fighting foreclosure. According to Thompson, “we urgently need that funding,” but it has not yet been appropriated. She also noted that foreclosure-mediation programs like the ones in Philadelphia and New York—which she said are reducing foreclosures by about 50 percent—have produced positive results and should also receive better funding.

2) Regulate the fees banks are heaping on homeowners. “There’s been a huge abuse” with forced place insurance, Miller told the committee. American Banker, in a piece this week, noted that “astronomically priced” insurance policies—purchased to protect investors—impose costs on investors and add to homeowners’ debts.  Bank of America and JPMorgan Chase executives at the hearing denied that their companies were trying to maximize fee revenue and stated that it was in their best interest to keep homeowners in their homes and paying off their loans. 

3) Solve the dual track of concurrent foreclosure and loan modification proceedings. We’ve noted that under the government’s loan modification program, servicers are forbidden from foreclosing while loan modifications are pending, but many homeowners have found the practice is still occurring. On this point, Bank of America’s top mortgage official, Barbara Desoer, told the panel her company is “very open to discussing changes for the existing pipeline that’s going through the dual track.” However, David Lowman, JPMorgan Chase’s top mortgage official, expressed some hesitation about such changes. “I think we have to be careful with that,” he told the panel.

4) Take servicers out of the loan modification process altogether. “Servicers were never in the loan modification business,” argued Georgetown University Law Center associate law professor Adam Levitin. “They’re in the transaction processing business.” Levitin suggested creating a federally administered loan modification program with a system of triage, much like in bankruptcy court: Homeowners who absolutely can’t pay would get an expedited foreclosure proceeding; homeowners who can pay would be given “a cookie cutter mod” with principal reduction, he said. As we’ve noted, the government’s loan modification program has resulted in few permanent modifications, but data suggest banks’ in-house programs are even worse.

Bank of America CEO Brian Moynihan has called for a quick settlement of the 50-state attorney general probe. CNBC reported yesterday, citing anonymous sources, that banks and state attorneys general were “nearing a settlement,” but when asked by lawmakers, Iowa Attorney General Miller said a settlement is still months away.

Inform our investigations: Do you have information or expertise relevant to this story? Help us and journalists around the country by sharing your stories and experiences.

Item 4) is a great point.  When borrowers become delinquent the servicer will advance principal and interest to the investors.  This outlay can be easily recovered in a “normal” market.  Given the current environment of liquidations and foreclosures, these advances have become enormous.  Foreclosure is the only way the servicer is able to recoup and is a must for their survival.  They should get back to the business of processing transactions with no interest in the loan. 
As far as the banks are concerned, the speed of the settlement they desire is directly proportional to the amount of responsibility they are trying to cover up.

Subconscious mind don’t lie. It has been proven in our court many times.

Here is David Lowman about evicting people on the senate hearing on Nov. 16. 2010

I quote David Lowman.

“The fact is we don’t make money when we foreclose on costumers.
It is in our best interest to figure out ways to make loans perform again. And is a result of that we EVICT we invest significant effort…........

If you don’t believe me just visit the website, scroll down on the transcripts where all the pictures and times are on the left hand side to David Lowman
1 min  

then click on it and listen.

Then draw your own conclusion about Chase willingness to help homeowners.


Nov. 17, 2010, 11:14 p.m.

Don’ t believe anything these Banksters say they have no credibility, the make thousand of dollars when they Fraudclouse on your home they collect Insurance etc AIG)
Its not perjury to lie under owed?  Why the law does not apply to this Banksters?  What bunch of Liars! On top of Lying under owed at her congressional testimony
Here are some of their usual Lies:
1-Your file is in review, (20+ times)
2-The investor does not approved a modification (but when you request to know who is the investor they send you a letter stating that now you may qualify for a modification)
3-It did not pass the NVP test (when you request in writing that they send you their NVP test calculations and you get it all calculations are wrong, coincidental?)
4-We have not received the documents we requested (they tell you that after you sent the same documents they requested time after time)
5-You modification its cancel because you did not submit the documents on time (even that you have proof with fax transmitions etc and with dates when docs where sent not once but many)
6-You do not qualify for a modification but when you ask for the guidelines to find out why you do not qualify or mention that according to HAMP you do qualify then they said that they will review your case (again)
7-Not enough income ( but when you review the income they have in the system is all wrong even that you sent them your pay stubs more than 10 times)
8-We don’t have any of your paperwork (that is after working one year with the bank to get a modification. Suddenly they don’t have your paperwork ? wow )
And there is more…. but it will be to long to write here
Don’t believe anything these Banksters tell you, get inform, Read the articles in Pro publica, and, watch the Dylan Ratigan Show on MSNBC, Go see the movie (documentary) Inside Job,, Read the book 13 Bankers, write your congressman, Get inform!  The more informed the American People are the more difficult will be for these Banksters and servicer’s to Lie and steal the wealth from this country and the middle class

Chase CEO David Lowman recently admitted in front of the Senate banking committe that CHASE do not do principal reduction only forberance.

As you will see in the testimony on Nov 18th 2010 front of Congress, Chase do not even mention Principal Reduction. Only forberance.

How can Chase get away with this? When they signed the Participation Agreement Re. HAMP it is in the HAMP guidelines that banks may reduce principals. Maybe Chase is the Treasuries pet .

Chase can disrigard HAMP guidelines.
Deny elegible loans for modification.
Brake into peoples homes.
Lie to Congress.
Collect insurance money for defaulted mortgages,
then sell the homes for 30cent on the dollar.
Keep the money so they can raise their dividends from 20 cents to $1?  And get away with it.

How long before the American middle class will wake up?

When we have 35 million people on the streets?
By then it will be too late.


Nov. 18, 2010, 1:57 a.m.

Gabor Like i said, What a bunch of Liars ! and laying under oath?


Nov. 18, 2010, 2:23 a.m.

Here is what we are dealing with…

So, we keep writing letters, making phone calls, sending emails, etc. with cc’s to Lowman & Dimon until they’re exposed.  There’s strength in numbers and we have the numbers AND the strength to beat these scumbags at their own game.  It may take time, but we can do it.

EVERY time I send an email to Sec. Donovan or some other “person in power or politics,” I get a phone call from someone in Dimon’s exec. office trying to smooth things over and shut me up.  Then, of course, there are MORE delays, so I send MORE letters & emails.  I know for a fact they read their emails because those are the cc’s I’ve been sending for the past few months - busted.

What goes around comes around.  Trust me :)

I also emailed this article, along with the comments & my statement saying I have documents from Chase to prove Lowman is lying.  Chase made the mistake (for which I’m grateful) of lying to me in writing with regard to who the investor of my loan is, the interest they added to my principal balance (they claimed that’s “illegal” but they did it anyway), slews of letters stating they “have all the docs necessary & reviewing…” AND letters I received literally a day later stating they “didn’t have the necessary docs and need….”

Watch Congressional Oversight Panel
live hearing on Lawmakers Question Mortgage servicers on Robo-signing

Nov. 18th 2010 @ 10 am Eatern

I’ll have to watch it later on - kids will be back from ART in a few minutes. :)  Thanks for the link, Gabor!!


Nov. 18, 2010, 5:55 p.m.

Maureen good for you I’m glad you also e -mailed this article, Please don,t quit,  our only hope is to unite, fight, recollect signatures, write to your representatives support Pro bublica etc,
Gabor: Please don’t stop giving us good Information it is appreciated by all Americans
We all know Chase is the Biggest Lier !  B o A close 2nd and the rest
We have to find more ways to dispute their lies and catch them in their own game
Information is Power

Acmod - thank you for the words of support.  “Quit” has NEVER been part of my vocabulary.  What gets me is, HOW can Chase all of a sudden be the “investor” of my FHA loan when they’ve been claiming it’s Ginnie Mae & blaming htem all along for the delays in the mod?  I mean, honestly, my income supports a mod, my job is stable, I’m supposedly the “ideal candidate” because I qualify for a HAMP.  So, 20 months later I’m STILL “under review” and have to send MORE docs they’ve “not received?”  Also, “don’t pay your mortgage because it’ll just be sent back to you or put into a suspense account.”  I wouldn’t know what to send anyway because they won’t accept anything.  OH - another thing Chase claims they “weren’t aware of” is FHA mtgs JUST became eligible for HAMP mods this past June.  NO ONE told me that - instead they strungme along telling me it was “guaranteed based on” my qualifications.  Are they kidding? 

Any other advice you may have would be greatly appreciated!!

Thank you Maureen acmodspecialists for your compliment.

Did anybody saw the video regarding
Subconscious mind don’t lie.

When David Lowman subconsciously stated we EVICT
on my earlier post on the video?

I would like to know if anybody heard that beside me. I think it is very very important.
was it a slip? was it the truth? or the truth slipped out?
Waiting to see some responses.
Thank You.

Gabor- You were 100% correct. I ran it back about 5 or 6 times. Had my neighbor come over and they heard the same thing.
He said “evict” first, then he smoothed over with the word “invest”.
Like you said “subconscious minds do not lie.”

Gabor- I meant he said “evict” then “investED”

Thank You Roy you have made my day.

Now if we could have CNN on this. Unfortunatly CNN Anderson Cooper has more important news.
You know dealing with celebrities, Weddings, Monkies,

I used to watch it all the time but I am realizing that our news sources have more important things to do, then dealing with real issues.

These are the people who should be in charge for loan modification . Including Maxine Waters

Nissim Sasson

Nov. 19, 2010, 3:07 a.m.

Garbor Yes I heard it ! right here!
at minute 16: 37 very clearly he states ECICT then quickly switch to invested. Garbor,  there is someone in the media that it is calling these Fraudclosures and the Banksters every day ! and that is The Dylan Ratigan Show on MSNBC I recommend everybody to watch it


Nov. 19, 2010, 4:09 a.m.

Gabor, you are definitely right, These people should be in charge of the HAMP

Gabor - I heard Lowman say “evict, ” too.  That guy is unreal. Someone there had to notice what he said, too.

IF Chase had just modified qualifying loans/customers from the beginning, NONE of this would’ve happened. Instead, they ahve all of us months & months behind because they:

a) hold all forbearance payments in a suspense account (which lasts forever - way beyond 3 months & they DO NOT do HAMP trials until they’re forced to - I’m still waiting)

b)  “don’t have to follow gov. guidelines because we have our own programs” per Denise Strother at Chase

c) “FHA loans only became eligible for HAMP this past June - no one knew that - sorry.” per Carol Masters at Chase (who has actually been very helpful & honest - at least someone at Chase is)

d) “Don’t send in your payments because we’ll either send them back or put them in your suspense account, which doesn’t get credited to your account anyway.”  Tom Holdstein - Chase


Nissim Sasson

Nov. 19, 2010, 3:26 p.m.

Yes that is exactly the kind of trap Chase makes to their customers they tell you “Don’t send in your payments because we’lleither send them back or put them in your suspense account, which doesn’t get credited to your account anyway” This way they create so many late fees interest and penalties that it becomes impossible for the borrower, become current or save their home from foreclosure because by then the debt is incredible bigger compare to when the borrower started requesting help, Loan Modification or the HAMP and then, they FRAUDCLOUSE !. (After that Bankster Chase makes thousand of dollars when they Fraud-clouse on the property by sticking the toxic asset to the tax payers (treasury department) and collecting the AIG insurance on top of the cash money Chase received form the sale of the property ) what a scam!


Nov. 19, 2010, 7:20 p.m.

Another big problem with Loan Mods, is that the Bankters and Servicer’s have a dual track system on one track they are processing a Loan Modification (while the banks makes it hard for the borrower to get approved) at the same time, In another track system they are foreclosing on the homeowner, This dual tracking system should stop immediately, while the borrower is trying to get approve for a Modification or its in the process, they should not do the foreclosure process in another system at the same time , Another big solution to this mess is to take away the Loan Modification program from the servicer’s and give it to and independent agency that can be fair and balanced

acmodspecialists said:

3-It did not pass the NVP test (when you request in writing that they send you their NVP test calculations and you get it all calculations are wrong, coincidental?)

I have been asking for 4 months for my negative NVP
calculation and after 20 different excuses, INCLUDING:

” it is out of Bank Of America’s hands, only the investors have that information and they are the ones that have to send it to you”

They still have not sent it!

7-Not enough income ( but when you review the income they have in the system is all wrong even that you sent them your pay stubs more than 10 times)

Exactly! and even when you call and ask them to read their notes back to you, and the numbers are correct, two calls later they are changed to different numbers!

It is almost like someone goes into the records and changes the numbers!

Why even bother asking for paystubs and all this proof if they are going to just put in their own numbers?

But the worst is the NVP test because there is no transparency at all. AND it is based on things that they can easily manipulate.

If I started the mod process with great FICO scores,
but they string me along for a year and by the time they do the NVP I now have bad credit and am delinquent BECAUSE of them, this effects the NVP.

In addition who knows how they decide the value of the home,  in some areas that is no simple task, and they can easily manipulate that as well.

I was concerned to hear everyone AGREE that as long as the NVP was positive a mod should be made, but nothing to make sure that the NVP is open, transparent and fair.

Marcy The reason the NPV is always negative because the banks don’t want to modify loans.
You heard David Lowman ,

“It is in our best interest to figure out ways to make loans perform again. And is a result of that we EVICT “

To tell people is that the NPV is negative is the same excuse as they did not receive the documents.
The fact is that banks make more money if they foreclose.NCLC made the statement on the hearing.
And the Law professor Mr. Leviton when he was reading Countrywide statement countrywide admitted it is better to kick people out of their home.

Just listen the first 5 minutes or all
Mr. Leviton is the first witness

And here is a Shocker.


Gabor, I agree, HOWEVER, the problem with the
negative NPV issue is that NVP is complicated, secret
and difficult for home owners to prove because even if they put in the correct income, there are parts that the banks can manipulate and that are open to opinion.

And during the hearings this was NOT mentioned, but it WAS mentioned many times that IF A HOMEOWNER HAS A POSITIVE NPV than modification should be done.

To me, this is the perfect LOOPHOLE excuse for the bank to use, and is difficult to challenge so I want to be sure congress the AG’s and law makers are aware of this, as it seemed to escape everyone’s attention.

Marcy have you visited   beingmiddleclass .org
you should visit the website lots of help and support on this website. Maybe we should start a campain against NPV. I know the NPV should consider market value for loan mod. I think the reason is secret is because property values have been plumeted 50% or more here in CA.

So many home loans should be modified because the value is a lot less then original mortgages in 2003- 2006. Banks are selling foreclosed properties for pennies on the dollar. An example. In our street there was a home sold in 2006 for $1,295.000 then it was foreclosed.
A few months ago the same house was sold for around $ 430.000


Nov. 20, 2010, 12:21 a.m.

Mary you should request the NVP test in writing, and send copy of the request to HAMP with copy of the letter that they sent you where it states you did not pass the NVP test lets assure that either they put value the home a lot higher or your income is incorrect in their test.HAMP contact:
Home Affordable Modification Program Solution Center
Whether you are having problems registering online, require support for the servicer tools, or have general questions about the Home Affordable Modification program, we are here to assist you.
HAMP Email .(JavaScript must be enabled to view this email address)  Phone (866) 939 - 4469 option # 2 Fax(240) 699 - 3900
Here is some info that may help:
When the borrower is not approved for a HAMP modification because the mortgage loan is deemed NPV negative as outlined in Announcement 09-31, Updates and Clarifications to the Home Affordable Modification Program, the notice must include a list of certain input fields that are considered to reach the NPV result and a statement that the borrower may, within 30 calendar days of the date of the notice, request the date the NPV test was completed and the values used to populate the NPV input fields defined in Attachment 1.

The purpose of providing this information is to allow the borrower the opportunity to correct values that may have impacted the analysis of the borrower’s eligibility.

If the borrower (or the borrower’s authorized representative) requests the specific NPV values orally or in writing within 30 calendar days from the date of the notice, the servicer must provide them to the borrower within 10 calendar days of the request. If the mortgage loan is scheduled for foreclosure sale when the borrower requests the NPV values, the servicer may not complete the foreclosure sale until 30 calendar days after the servicer delivers the NPV values to the borrower. This will allow the borrower time to make a request to correct any values that may have been inaccurate.

Upon receipt of written evidence from the borrower indicating that one or more of the NPV values is inaccurate, the servicer must verify the evidence and, if accurate, must re-run the NPV calculation if the correction is material and is likely to change the NPV outcome. Values that are not affected by the correction do not need to be changed from the first NPV calculation. If the borrower identifies inaccuracies in the NPV values, the servicer must suspend the foreclosure sale until the inaccuracies are reconciled.
Source: Home Affordable Modification Program Guidelines

Thanks ACModSpecialists and Gabor.

Yes, I know the website and I also know the HAMP “rules” , in the denial they even stated them!
I also tried hamp admin, by both phone and email, they never got back to.

I am not pushing it at the moment, because, as you must know, it takes SO MUCH time and energy to keep making calls to the bank, faxing, letter writing
etc every week, it’s like a full time job !

We have not been placed in forclosure ( yet ) and right now the bank has started to work with us,
but I will repush that issue if I need to, again.

Just getting the data would only be a part of the battle, because they only will rerun it if they put in wrong income or address, you can not try to dispute
the other issues, and they will not tell you what they have for house value , and I can not now change my fico scores that were excellent BEFORE they forced me into default and THAN ran the NVP test afterwards.

I do not want to argue point by point with them, that just wastes more time, I just want the damn loan mod! And I KNOW I should get one.

By the way, when they told me that my investor has the NPV details and they are the ones in charge of sending it to me, I contact my investors, Bank Of New York Mellon and to my surprise they called me back in one day!

Melissa J. Adelson, from The Bank of New York Mellon told me that they most certainly do NOT have that information, nor do they make those decisions, nor do they deny loan mods ( which BOA told me in writing as well, that my investor denied the mod ). She said, as we all know, that BOA as
their servicer makes all those decisions “for them “.


Nov. 20, 2010, 10:33 p.m.

Marcy Another Lie from the Banks What a surprise !

Does anyone know if it is possible to learn

1)  how many new mortgages has Chase made in the past year

2)  from start to finish, how long does it take Chase to process a new mortgage

Wouldn’t the contrast be further evidence that they are not as incompetent as they want everyone to think?

If you cant live with yourself because you gave up the fight with Chase, than dont give up…if the fight with Chase is killing you, emotionally or in other ways…I can only say…I was one of the very few that won my fight with Chase…..I went through it all for 2 years and finally have my signed, sealed,& delivered modification with Chase…..I am so sorry to hear that people are still going through this.  I finally realized that no matter where I lived…if they broke me emotionally ...they won….So I fought, and I won…if you want more info on my story…e-mail me at .(JavaScript must be enabled to view this email address).  My heart truly goes out to you all in this fight.  Stay strong, and remember…the weaker the prey….the easier the kill.  Educate yourself, knowledge is power. 
God Bless you all!!!!

Parallel Foreclosure

Dec. 16, 2010, 4:05 p.m.

I would like to see all dual track victims, also known as parallel foreclosure victims, (the actual name used by Chase Bank and Bank of America behind closed doors is parallel foreclosure) file a class action lawsuit.

Sarah Buduson first reported about Parallel Foreclosure in fall of 2009, but since then, no other reporter will use the unifying phrase, Parallel Foreclosure, which would make it easier to get more people involved in a class action lawsuit.

I was backed into a corner to sign a in house mod with BofA after being jerked around on MHA for 16 months. It was take it or leave it and with a handicapped child and being a senior and being scared of being in the street I signed under duress. My in house is 65 percent of TGI so how do they expect a hardship case like me to be able to stay in the home. This was a way to report to government that they made a perm mod but not say it was unaffordable and they will soon have my home anyway. I have since spoken to five different BofA employees all of whom were looking into a possible Escalation but never called back. I am borrowing money from family members to make the payments but that is just about over. Please note that all Trial payments were on time, all docs received and credit counseling completed as required under MHA which I was told I was approved for in a Fedex Letter which no one at BofA will acknowledge. I need help. Bank cares less.

Parallel Foreclosure

Dec. 26, 2010, 4:22 a.m.

Joseph James, this site has a page where you can report your story and propublica may be able to find a reporter to do a story about you for the local papers.

You sound like another victim of parallel foreclosure.
my parallel foreclosure blog has a story about a class action lawsuit for people in your situation.

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This article is part of an ongoing investigation:
Foreclosure Crisis

Foreclosure Crisis: Banks and Government Fail Homeowners

Banks and the government have fallen short in helping homeowners in danger of foreclosure.

The Story So Far

Systemic failures at the country’s banks and mortgage servicers have exacerbated the most severe foreclosure crisis since the Great Depression, and government efforts to limit the damage have fallen short. ProPublica created an unrivaled database of homeowners who have faced foreclosure, opened a Facebook page to encourage homeowners to share their stories, wrote profiles of some of them, and incorporated their experiences into our reporting. We also provided a comprehensive rundown of the numbers behind the crisis.

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